In relationship to the rest of the world, the U.S. is lagging behind when it comes to modern payment methods. Where other nations are on the fast track with alternative payment solutions, Americans primarily rely on cash and standard credit cards for transactions. But how far behind are the States really?
How the U.S. Stacks Up
The reality is the U.S. doesn’t just lag behind a little when it comes to advanced payments. In fact, the United States trickles in at the lowest percentile for adopting payments technologies.
Among the top international markets are South Korea, Australia, and Canada with contactless payments comprising more than 80% of all cards in South Korea. This number is compared to the U.S., which amounts to an unimpressive rate (<5%) of current contactless cards in the nation as of 2019.
One of the leading factors the United States faces when attempting to innovate payments is how fractured the retail market is. Unlike the more advanced nations’ markets, there is an increased number of establishments and banks that are thrown into the mix.
With so many diverse voices with various capabilities and procedures, it’s easy to examine why the current payment climate is divided.
Shifting Attitudes on Payments Innovations
Despite its low representation in the market, the U.S. is gradually taking the necessary steps to introduce more advancements in payments.
In recent news, New York City subways and buses began accepting contactless cards as a method of payment at turnstiles. This move was a major feat for alternative payments being accepted in a major way. This move also served as another clear departure from a cash-reliant society.
Americans are finally starting to see the convenience of contactless payments with the ease of use and fast processing time. The standard iPhone feature, Apple Pay, paved the way for users to seamlessly become accustomed to a form of contactless payment. For many, this was their first introduction to a form of contactless payments.
Although unprecedented, the COVID-19 pandemic has sped up the acceptance of contactless payments and digital payments in general.
Consumers are now more conscious of the number of public surfaces they come in contact with during a transaction. Despite heightened sanitary practices, the use of the cash is becoming increasingly frowned upon.
The Future of Contactless Payments
A decline in cash payments has opened the space up for more advanced versions to take place of the standard credit card. The gradual introduction of contactless payments in the U.S. has eased Americans into the idea of alternative payment methods. Beyond just the popularity and convenience they provide users, security and efficiency are heightened.
Security is a major concern when it comes to making transactions. As the customer, you want to be ensured your data isn’t be used without your consent–or worse, duplicated.
Cards with magnetic strips are most at risk for this type of scam, because of how accessible the information is within the card. This is a leading reason why consumers end up making the switch to contactless and chip cards.
In a society that is all about speed and efficiency, contactless methods of payment ensure ease of pay. Clicking through the different options, entering a PIN number, or even providing a signature are minimized by the brief tap these card readers require. Saving time at the cashier not only speeds up the process for the user but more importantly the flow of a busy retail location.